Healthcare financing systems | Статья в журнале «Молодой ученый»

Автор:

Рубрика: Экономика и управление

Опубликовано в Молодой учёный №9 (143) март 2017 г.

Дата публикации: 07.03.2017

Статья просмотрена: 36 раз

Библиографическое описание:

Нарулин Д. С. Healthcare financing systems // Молодой ученый. — 2017. — №9. — С. 428-430. — URL https://moluch.ru/archive/143/40259/ (дата обращения: 23.02.2019).



Healthcare is a very important component of the country`s social policy. Health protection and creation of conditions for healthy lifestyle need to provide human well-being and sustainable socio-economic development. In 1978, the World Health Organization (WHO) and United Nations Children's Fund (UNICEF) held the international conference on primary health care (PHC) in Alma-Ata, that adopted the Alma-Ata Declaration — the strategy of «Health for all», which became a turning point in the history of public health. This strategy includes the development of primary healthcare as the foundation of the health system, guaranteeing equal access of all citizens to health services, and thus contributes to improving the quality of people`s life around the world.

Formation of healthy lifestyle, prevention, treatment and rehabilitation is impossible without a well-functioning system of financing healthcare. The resolution of the World Health Assembly in 2005 declared that everyone should have access to health services and should not suffer financial difficulties as a result of access to medical care.

In today's world, financial provision of health care is provided at the expense of budget funds, employers' funds, funds of the population. The share of each of them in the total amount of funds allocated for the healthcare, determines the model of financing the industry.

Nowadays there are three models:

− Budget and insurance model — healthcare is financed from target payments of employers, employees and the budget funds. This is the most common model (Germany, France, Austria, Switzerland and others).

− The budget model — is carried out mainly at the expense of budgetary funds (UK, Denmark, Norway, Finland and others).

− Private model — financial support due to the health services sales to the population and at the expense of the voluntary medical insurance funds (USA).

Budget-insurance healthcare financing system.

Social significance of the system of obligatory medical insurance (hereinafter — OMI) considers, on the one hand, that it is an integral part of the state system of social protection of the population and, on the other hand, the OMI funds complement and, in some cases, replace budget allocations for health.

An analysis of the financing and organization of health care in foreign countries has allowed probation to identify three basic models of the economic healthcare mechanism. The first — mostly state free healthcare, as in England, Denmark and Ireland. The second is the financing of basic health care by the private insurance companies, as, for example, in the United States. In most developed countries, such as France, Germany, Italy, etc., financing healthcare has a mixed insurance-budget nature. In this case, targeted programs, capital expenditures and certain other expenses are paid by the state, while basic healthcare funding is going through the health insurance. Currently, the insurance system of health and social care continue to evolve. Insurance in case of illness introduced in more than 25 countries. It is mostly the industrialized countries of Western Europe, North America, Australia, Israel, Japan, some countries of the Middle East and Asia. Insurance systems in case of illness are public, private and commercial. In most of the countries mixed insurance systems are used.

Health insurance systems usually managed by government, but funded from three sources: targeted employers ' contributions, government subsidies, contributions from the workers themselves. In some countries there is no state subsidies for payment of medical assistance, and the contributions for health insurance provided at the expense of entrepreneurs and workers. Along with this individual Western European countries successfully continue to develop systems primarily with government funding of health care. Among them Scandinavian countries, Portugal, Ireland, UK.

Obligatory medical insurance has fundamental differences from other types of insurance. First, the OMI funds used for medical services payment and not for payments in cash. Secondly, organizational functions for payment services perform commercial organizations — health insurance companies that are the insurers of the citizens. Thirdly, when insuring, the assets of Russian Federation entities budgets are used, as the Executive authorities are the insurers of non-working citizens.

Financial and organizational mechanism of obligatory medical insurance depends on its level.

The first level is the Federal Fund of obligatory medical insurance (FFOMI) which carries out regulatory and organizational management of the OMI system. The main financial function of the FFOMI is the provision of subventions to territorial OMI funds for equalizing conditions for the provision of health services for citizens of economically differently developed regions.

The second level of obligatory medical insurance organization submitted by the territorial OMI funds and their affiliates. This level is primary by law, since territorial funds provide accumulation and disbursement of financial resources. Territorial funds of obligatory medical insurance (further — TFOMI) are created on the territories of the Russian Federation subjects by representative and executive authorities of these entities. They are independent state noncommercial financially-credit institutions and are accountable to authorities. The main objective of the TFOMI is to ensure the implementation of OMI on the territory of the subject of the Russian Federation according to the principles of universality and social justice. TFOMI has the main work to ensure financial balance and stability of the OMI system. However, nowadays, local funds reminiscent transfer, not the main part of medical insurance.

The third level of the OMI implementation is represented by the medical insurance organization (MIO). By the law they are given a direct role of the insurer. MIO receive funding for the implementation of OMI from TFOMI according to the “per capita ratios” depending on the number and age structure of the insured population and realize the cost of health services provided to insured citizens.

Budget healthcare financing system.

Funding for medical care here provided from the state budget, formed by general taxation. In some countries, as a source of funds for healthcare fixed tax revenues are used. For example, in Brazil since 1998 part of the tax on bank turnover, calculated as the rate of 0.2 %, directed to the health sector. The system administrators of budget financing are state healthcare authorities. They pay for the medical care provided to citizens by private practitioners and medical organizations, which are mostly state-owned. In some countries, where this system is used, co-payments provided for public health services received. They are small and easy to pay for patients and provided in order to restrict the excess demand.

System of budget financing and the system of obligatory medical insurance are alternative ways of organizing state health financing. The most important difference between these two systems and private healthcare financing system — there is no correlation between medical services received and personal solvency. The advantage of the budget system in comparison with insurance system is a lower level of required administrative costs — the costs of maintaining health authorities. Such a system has a relatively better possibility to ensure state control over the activities of manufacturers of medical services at the lowest cost. In insurance system, there are more managing subjects — insurers themselves, and public health authorities that perform the functions of the entire system regulation and controlling over the activities of healthcare organizations and insurers. In insurance system the volume of collected and processed information and documents is larger.

The disadvantage of the budget system is the high dependence of health financing from changing political priorities. Each year the size of the healthcare budget determined in the fight between competing directions for budgetary expenditures. In contrast, healthcare financing in insurance system has clearly set out the sources and therefore less dependent on the political situation. The insurance system provides more guarantees for receiving medical service according to the size of financial inflows. The premiums are balanced with the volume of the guarantees included in the OMI program.

But these comparative advantages can become weaknesses in certain cases. OMI system has a narrower financial base — premiums are set as a percentage of employees compensation fund. In bad economic situation, the size of collected premiums can reduce and the OMI system will accumulate not enough funds to pay guaranteed benefits package of medical care.

The advantage of the insurance financing system, in comparison with the budget healthcare financing system is a clear institutional separation of functions and responsibilities between the subjects of financing healthcare services and their manufacturers. Insurers are responsible for ensuring that the insured received the necessary medical aid and for the payment of this aid. They are intermediaries between medical organizations and the citizens that are economically interested in protecting the rights of the insured and the effective use of financial resources they command.

Private healthcare financing system.

In the private healthcare financing system individual citizens incomes and employer funds are sources for payment of medical care. Currently the USA is the only country where medical care is provided primarily on a fee basis. So the base of American model of healthcare financing is private insurance. The employer buys insurance for all their employees from insurance companies that compete with each other. These companies can be non-profit or commercial organizations. Terms of insurance are determined by how much the employer is willing to pay for their employees. Insurance companies set their own tariffs, although for non-profit organizations, the legislative organs of the state may establish special rules of conducting tariff policy (for example, from all the inhabitants of this region the same insurance premium was taken — this allows more adequately distribute risks between healthy and less healthy citizens). However, the main task of planning costs goes to insurance companies that negotiate rates with hospitals and doctors or just pay the medical bills for the insured. Under this system, the patient has the right to choose a doctor, the doctors are competing with each other and this, according to some economists, leads to the establishment of equilibrium prices for medical services. The insurance companies use actuary method to calculate possible needs for assistance.

There are special institutions in the United States for the maintenance of health (Health Maintenance Organizations — HMO) — this medical facility created by insurance companies to reduce costs. The amount of funding in HMO is calculated per capita. The insurance company determines the volume of assistance provided, the cost of treating one case, and correlating this with the number of people insured, plan the spending for the next year. The responsibility for this rests with the insurance company. If the client (employer) is not satisfied with the amount of services he can find another insurance company.

Over the last 40 years there has been a significant shift in the direction of growth of state expenditure on health care. Currently the US government pays over 40 % of health expenditure in the country (and in 1960–21 %). This is due to the fact that since 1965 the US has a Federal system of social insurance for the elderly called «Medicare». The system is funded by a special income social tax, the amount of which is set by Congress and paid by the citizen (50 %) and employer (50 %). To manage the collected money a special Medicare Board of Trustees was created. It`s task is the operational management of the Fund and expenditure forecasting. Issues of cost planning and tariff policy are in the hands of USA Congress. Congress defines groups of people who may obtain paid assistance in Medicare, and the methodology for calculation of tariffs for the specific services provision.

Simultaneously with the social insurance system for the elderly, there is a social insurance system for the poor called «Medicaid». It is controlled by the States, which establish rules of inclusion in the system and tariff policy. Funding comes from the budgets of State with additional funding from the Federal budget. Tariff policy generally corresponds to that of Medicare but may vary greatly. Planning usually comes from the size of budget allocations for the program and projected per capita expenditures. The minimum income is set up, below which the person becomes a potential consumer of services Medicare. In addition, the Office of veterans Affairs (VA) works in the United States. It is funded by the defense budget of the United States. It provides free access to healthcare services to veterans of the U. S. armed forces.

In general, there is no single mechanism for planning health care costs in the U. S. healthcare system, the volume of rendered services is determined as a result of either choice the patient or the insurance company. Legislators actively regulate only the component of social insurance by establishing a tariff policy. Tariff policy aimed at controlling the growth of health care costs, not at making better provision for health protection requirements.

References:

  1. Elias Mossialos, Anna Dixon. Funding Health Care: Options for Europe. — Buckingham, Philadelphia. — Open University Press, 2002. — 301 p.
  2. Overview of Health Care Financing // Merck Manual. URL: http://www.merckmanuals.com/home/fundamentals/financial-issues-in-health-care/overview-of-health-care-financing (date of access: 2.03.2017).
  3. The system og healthcare financing in USA // Rosmedstrah. URL: http://www.rosmedstrah.ru/articles.php?blk=4&id=74&show=1&theme=15 (date of access: 2.03.2017).
Основные термины (генерируются автоматически): OMI, TFOMI, USA, URL, FFOMI, MIO, HMO, PHC, UNICEF, WHO.


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